ROBBINSVILLE: Amazon to open mega-warehouse in 2014

New facilty off Old York Road to bring hundreds of jobs

By Joanne Degnan, Managing Editor
ROBBINSVILLE — The online retailer Amazon plans to open a 1 million-square-foot fulfillment center in 2014 off Old York Road that will provide hundreds of jobs and millions of dollars in revenue for the town, county and school district.
KTR NJ Urban Renewal, a private equity firm specializing in industrial real estate investments, will build the $200 million facility on a vacant 79.75-acre parcel in the Southeast Industrial Redevelopment Area and lease it to Amazon. The site is located between Gordon Road and Interstate 195 near the Upper Freehold border.
The Township Council approved a 20-year Payment in Lieu of Taxes (PILOT) agreement worth $22 million with KTR on Nov. 8. At the time, KTR was under contract to purchase the property from Matrix 7A Urban Renewal, which already had existing township approvals to build a 1-million-square-foot "spec" warehouse.
KTR finalized the $20,686,000 purchase of the property from Matrix on Dec. 20 and signed a lease with Amazon the next week, according to public documents recorded in the Mercer County clerk’s office. The lease commences in April 2014.
"We are extremely excited to welcome Amazon to Robbinsville Township," Mayor Dave Fried said Tuesday. "We understand Amazon could have chosen anywhere in New Jersey to build its new distribution center and we are fortunate to have the infrastructure and resources to meet their needs and consummate one of the most sought-after business partnerships in recent memory."
State law allows municipalities to grant tax abatements such as PILOTs in designated redevelopment areas in order to spur economic growth. The Township Council designated the 176 acres of mostly vacant land in the Southeast Industrial Redevelopment Area as an area in need of redevelopment 16 months ago. The parcel Matrix recently sold to KTR comprises about 45 percent of that zone.
The township will keep an estimated $13.45 million of the projected $22.1 million in total PILOT payments that it collects from KTR over the next 20 years. The county’s share of that total is $3 million and the school district’s is $5.56 million. PILOT payments are estimates because they are calculated as a proportion of taxes otherwise due, and based on projections of future assessed values.
When KTR executives attended zoning board and council meetings about the project in November they declined to identify their prospective warehouse tenant even as public officials were already acknowledging that there had been talks with Amazon to attempt to bring the online retailer to Robbinsville. Amazon’s announcement Tuesday was its first public confirmation of the firm’s involvement in the project.
Amazon said employees working at the planned Robbinsville facility would pick, pack and ship smaller items such as books and DVDs to customers. The company’s news release noted its fulfillment center jobs pay on average 30 percent more than traditional retail jobs, not including stock grants that full-time employees receive that have boosted their base pay an average 9 percent over the past five years. Amazon also offers full-time benefits, including health care, the company said.
"We are excited to open our first fulfillment center in New Jersey, bringing jobs and investment to Robbinsville Township," Mike Roth, Amazon’s vice president of North American Operations, said in the corporate news release.
"We appreciate the support of the New Jersey Economic Development Authority, (the NJ Department of State’s) Business Action Team, and other state and local leaders who have worked with us to find this site," Mr. Roth said.
Gov. Chris Christie and Amazon executives held a news conference in May 2012 to announce Amazon’s intention to locate two 1-million-square-foot warehouse distribution facilities somewhere in New Jersey and also start charging Garden State residents sales tax on their online purchases.
Currently, Amazon does not collect sales tax from New Jersey customers because the company doesn’t have a physical presence here. Although residents are legally required to pay 7 percent sales tax on online retail purchases when they file their state income taxes, few actually do.
Once Amazon begins collecting the state sales tax up front from consumers, it will produce an estimated $30 million to $40 million in new annual tax revenue for the state, Gov. Christie said last year.
The governor has said that the two New Jersey Amazon facilities would create up to 1,500 full-time jobs combined for New Jersey residents, and thousands of temporary, seasonal and construction jobs.
The Amazon’s press release on Tuesday did not address the status of the second New Jersey warehouse or its location. Amazon said the Robbinsville warehouse would create "hundreds of jobs," but did not give specific hiring figures.
A message left at Amazon’s media relations office at the corporate headquarters in Seattle was not returned on Monday.